In its effort to achieve the African Continental Free Trade Agreement (AFCFTA) objective of improving trade in the continent, AFEX Nigeria has launched Africa Exchange, a digital platform for trading commodities to promote fair market prices, increase food production and help farmers earn more.
The platform will equally enable investors to diversify their portfolios while supporting the financing of food ecosystem and further transform the commodities space in Africa.
It will also help commodities market players to meet and interact both in the physical and financial markets. The CEO and President of AFEX Nigeria, Akinyinka Akintunde, said AFEX, as a team, is excited and proud to launch Africa Exchange as another step in building digital infrastructure to facilitate trade across Africa.
He said with the launch, their goal is to boost the commodities market in Africa and allow more investors to participate with all the information that they need at their fingertips.
“Commodities have been high-performing assets in recent years; in 2021, commodities were the third highest performing asset, averaging about 37.1 per cent in returns, while stocks averaged about 36.9 per cent. The commodities market has grown in sophistication over the years with the likes of commodity brokers and other institutional players making their mark and creating opportunities for trading.
“With Africa Exchange, we are the African commodities ecosystem to more investors and players. Through the platform, users can directly trade physical commodities or invest in commodity-backed financial instruments,” Akintunde said.
The new platform provides a structured marketplace duly regulated by Nigeria’s Securities and Exchange Commission (SEC), ensuring that users can participate in various trade or investment opportunities.
According to the firm, Africa Exchange will replace ComX, which has served over 80,000 investors in Nigeria and facilitated trades worth over $200m since it was launched in 2020.
The transition further bolsters AFEX’s mission of facilitating wealth creation for a new generation of Africans by providing them with alternative investment options to enrich their existing portfolios.
Currently, only 14.4 per cent of Africa’s exports come from trade between African countries. However, the AfCFTA could increase intra-African trade by approximately 33 per cent and reduce the continent’s trade deficit by 51 per cent, according to the United Nations Conference on Trade and Development (UNCTAD).
In line with the United Nations Sustainable Development Goals (SDGs) 1, 2, 5, 8 and 12, the launch of Africa Exchange is a significant milestone towards achieving the AfCFTA.
The Vice President, Financial Markets at AFEX, Funto Olasemo, said, “For the last eight months, we have been focused on improving our core infrastructure and delivering a better digital interface for commodities trading and investment on the continent. We have continued to also pursue product innovation, and the new tranche of our Fait Trade ETC (FETC) product is a great example of that.
“The FETC has been a hugely successful product since we introduced it in 2020, and we have structured a tradeable component into this tranche, giving investors even more freedom as they build wealth. The team is excited that we are facilitating wealth creation for a new generation of Africans by providing them with alternative investment options to enrich their portfolios,” Olasemo said.
He noted that AFEX is committed to improving intra-African trade, adding that to achieve the goal, the company has been bullish in pursuing its strategic Pan-African expansion plan since expanding into Kenya and Uganda in 2021 and 2022.
He concluded: “AFEX is set to expand to six other African countries within the next few years with the aim of promoting efficient trade in commodities across the continent while supporting the objectives of the AFCFTA to boost regional trade integration.”
